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The Bank Of England Decided To Raise The Benchmark Interest Rate To 0.25%


After the Bank of England's interest rate meeting, the Monetary Policy Committee (MPC) unexpectedly announced that it would raise the benchmark interest rate by 15 basis points to 0.25% with an 8:1 vote. The market originally expected the threat of the Omicron variant epidemic, even in the face of a 10-year new annual inflation rate of 5.1%, the Bank of England will stand still. The statement after the meeting pointed out that it is expected that there will continue to be two-way risks in the medium-term inflation outlook, and that it may be necessary to moderately tighten monetary policy in order to achieve the 2% inflation target in a sustainable manner. Regarding the inflation outlook, MPC expects that the local annual inflation rate will remain at around 5% for most of the winter, and reach a peak of around 6% in April next year, and then fall back in the second half of next year. The Bank of England unexpectedly raised interest rates and expects that inflation will rise further next year, driving the pound exchange rate to rebound.
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